Dear SaaStr: What Are the Slides That Should Be in Every VC Pitch Deck?

Here’s the structure I like to see in a pitch deck—it’s simple, clear, and designed to get investors excited without wasting time. Every slide should have a purpose, and the first few are critical to hook the audience:

1. Title Slide

Keep it clean—company name, tagline, and maybe a killer stat or tagline that grabs attention. For example, “The #1 AI Platform for Customer Success.”

2. Problem

What’s the pain point? Be specific and data-driven. Show why this problem is urgent and worth solving.

3. Solution

How are you solving it? Keep it concise and compelling. A visual or demo screenshot can help here.

4.  Why Now?

Timing is everything. Show why this is the perfect moment for your solution to succeed. For example, “AI adoption in customer success is growing 40% YoY.”

5. Market Opportunity (TAM/SAM/SOM)

Break down your TAM, SAM, and SOM with clear math. Tie it directly to your pricing model and ICP. Investors want to see how big this can get and how realistic your assumptions are [8].

6. Product

Show the product in action. Use screenshots, mockups, or a short demo video. Highlight what makes it unique.

7. Traction

If you have revenue, customers, or growth metrics, this is where you shine. Be specific—“$1M ARR, growing 20% MoM” is far more compelling than vague claims.

8. Business Model

How do you make money? Show your pricing, ACV, and any early signs of strong unit economics (e.g., CAC, LTV).

9. Go-to-Market Strategy

How are you acquiring customers? Highlight your sales motion (PLG, enterprise sales, etc.) and any early wins.

10. Competition

Acknowledge your competitors and show how you’re different. Be honest and self-aware—it makes you look smarter. Include the top 8-10 competitors and position yourself clearly.

11. Team

Why are you the team to win? Highlight relevant experience and any key hires you’ve made or plan to make.

12. Financials

Keep it high-level—current revenue, burn rate, and projections for the next 12-24 months. Don’t overcomplicate it.

13.  The Ask

Be direct. How much are you raising, and what will you achieve with it? For example, “We’re raising $3M to scale from $1M to $5M ARR in 18 months.”

14. **Closing Slide**

End with your logo, tagline, and contact info. Make it easy for investors to follow up.

Key Tips:

– **First Slide Sells the Deal**: Your first slide should be so good that it could sell the whole company on its own.
– **Keep It Fairly Short — But Complete**: 15-20 slides max. If you can’t tell the story in that space, you’re overcomplicating it.
– **Data Over Fluff**: Investors want numbers, not vague promises. Back up every claim with data.

A related deep dive here:

Dear SaaStr: What Are The Top Red Flags for VCs When Deciding to Invest in a Startup?

When VCs evaluate startups, there are definitely some red flags that can make them hesitate—or outright pass—on an investment.

Here are the key factors that are often considered “bad” news:

1. Weak Founder or Team

VCs invest in people as much as they invest in ideas. If the founder lacks vision, resilience, or the ability to execute, that’s a dealbreaker. A founder who can’t clearly articulate their strategy or who seems uncoachable will raise concerns. Early-stage VCs, in particular, are betting on the founder more than anything else.

2. Small or Unclear Market

If the total addressable market (TAM) is too small, or if the startup can’t clearly define its market, VCs will struggle to see how the company can scale. A small market means limited upside, and VCs need big outcomes to make their portfolio math work. Remember, they’re looking for companies that can deliver 100x or more returns for early stage, and 10x or more returns for late stage investments.

3. High Churn or Poor Retention

For B2B startups especially, churn is a killer. If customers aren’t sticking around, it’s a sign that the product isn’t delivering enough value. VCs know that poor retention makes it nearly impossible to scale efficiently. A startup with high churn is a risky bet.

4. Overly Aggressive Burn Rate

If a startup is burning cash too quickly without clear ROI, it’s a red flag. VCs want to see that founders are capital-efficient and can stretch their runway. A high burn rate without corresponding growth signals poor financial discipline and increases the risk of running out of cash before hitting key milestones.

5. No Clear Differentiation

If the startup doesn’t have a unique value proposition or defensible moat, it’s hard to justify an investment. VCs need to see how the company will stand out in a crowded market and fend off competitors. Without differentiation, the startup risks becoming a “me too” product.

6. Unrealistic Projections

Overly optimistic financial projections or growth assumptions can make a founder seem out of touch. VCs want to see ambitious goals, but they also need to believe those goals are achievable. If the numbers don’t add up, it’s a problem.

7. Misalignment of Incentives

This is more subtle, but if a founder’s goals don’t align with the VC’s goals, it can be a dealbreaker. For example, if a founder is focused on building a lifestyle business or aiming for a small exit, that won’t work for VCs who need big outcomes to drive their fund returns.

8. Lack of Traction

Traction is proof that the market wants what you’re selling. If a startup doesn’t have paying customers, strong user growth, or other signs of traction, it’s hard for VCs to justify the risk. Early-stage startups can get away with less traction, but there still needs to be some evidence of product-market fit.

9. Poor Timing

Even a great idea can fail if the timing isn’t right. If the market isn’t ready for the product, or if the startup is too early or too late to the game, it’s a tough sell. Timing is one of those factors that’s hard to control but critical to success.

10. Bad References

If a VC hears negative feedback about the founder or team during backchannel reference checks, it’s often game over. VCs rely heavily on their networks to validate a founder’s reputation and track record. Bad references can kill a deal faster than almost anything else.

Final Thought

VCs are looking for reasons to say “yes,” but they’re also trained to spot risks. Any one of these factors can make them pause, but a combination of them? That’s a hard no. If you’re pitching VCs, focus on addressing these potential concerns head-on. Show them why your team, market, and product are worth the bet.

Dear SaaStr: How Do I Build a Great SDR Team?

Building a great SDR team is one of the most critical steps in scaling a SaaS company, especially when you’re selling to the C-suite or enterprise. SDRs are the engine of your pipeline, and if you get this right, it can transform your sales organization.

Here’s how to do it:

1. Hire for “Fire in the Belly”

– **What to Look For**: SDRs don’t need prior experience in sales, but they need grit, hunger, and a relentless drive to succeed. Look for candidates who are coachable, curious, and have a strong work ethic. These traits are far more important than a polished resume.
– **Pro Tip**: Many great SDRs come from unconventional backgrounds—teachers, military veterans, or recent grads. They’re often looking for a career change and bring fresh perspectives.

2. Start with Two SDRs, Not One

– **Why?**: Hiring a single SDR creates a lonely and unproductive environment. By starting with at least two, they can learn from each other, compete in a healthy way, and share best practices. Plus, if one doesn’t work out, your pipeline doesn’t collapse.
– **Pro Tip**: Pair them with your best AEs early on to build trust and ensure they’re learning from the best.

3. Build a Clear Onboarding Roadmap

– **What It Includes**:

• Week 1: Product training, ICP (Ideal Customer Profile) deep dives, and tool onboarding (e.g., HubSpot, Outreach)
• Weeks 2-3: Role plays, email/phone training, and certifications (e.g., mock emails and calls reviewed by managers)
• Weeks 4-13: Gradual ramp-up to full quota (e.g., 40% of goal in Month 2, 70% in Month 3, 100% in Month 4.

– **Pro Tip**: Create a repository of winning email templates, call scripts, and objection-handling guides to accelerate their learning curve.

4. Set the Right Metrics and Quotas

– **Key Metrics**:

• Meetings booked per month (e.g., 15-20 per SDR).
• Pipeline generated (e.g., $1M-$2M annually per SDR).
• Lead-to-opportunity conversion rates.

– **Quota Design**: Focus on activities early (e.g., calls, emails) but shift to outcomes (e.g., qualified opportunities) as they ramp up. Make sure quotas are achievable to keep morale high.

5. Invest in Coaching and Management

– **Why It Matters**: SDRs are often early in their careers and need hands-on coaching. A great SDR manager can make or break your team.
– **What to Do**:

• Provide real-time feedback on calls and emails.
• Celebrate wins and milestones to keep morale high.
• Create a culture of learning by sharing best practices regularly [8].

**Pro Tip**: If you don’t have a dedicated SDR manager yet, ensure your AEs or VP of Sales are actively involved in coaching until you can hire one.

6. Align SDRs with AEs

– **Why?**: SDRs and AEs need to work as a team. SDRs generate the pipeline, and AEs close it. Misalignment here can kill productivity.
– **How to Do It**:

• Pair SDRs with specific AEs to build trust and accountability.
• Encourage SDRs to join AE calls to learn how deals progress and improve their qualification skills.
• Ensure AEs provide feedback on lead quality and help SDRs refine their approach.

7. Create a Career Path

– **Why?**: SDRs are often entry-level hires, and they’ll want to see a path forward. Without it, you’ll lose them to other companies.
– **What It Looks Like**:

• SDR → Senior SDR → AE or other roles (e.g., Customer Success, Marketing)
• Promote internally whenever possible. It’s less risky, and they already know your product and processes.

– **Pro Tip**: Highlight success stories of SDRs who’ve moved up in the company to inspire your team .

8. Leverage Tools and Data

**Must-Have Tools**:
– CRM (e.g., Salesforce) for tracking leads and pipeline.
– Outreach or SalesLoft for email and call automation.
– Lesha, Apollo, ZoomInfo, LinkedIn Sales Navigator, etc. for prospecting.
– **Why It Matters**: Clean data and the right tools make SDRs more efficient and effective. Bad data or outdated tools will frustrate them and hurt performance.

9. Hire SDRs from Many Backgrounds

– **Why?**: SDR teams are a great place to build a diverse talent pipeline. By hiring people from different backgrounds, you’ll not only improve your team’s creativity but also set yourself up for long-term success [11].
– **Pro Tip**: Invest in training and onboarding programs to help SDRs from non-traditional backgrounds succeed.

10. Iterate and Improve

– **What to Do**:

• Regularly review your Ideal Talent Profile (ITP) to refine what “great” looks like for your SDRs.
• Analyze performance data to identify patterns and adjust your hiring, onboarding, and coaching strategies.
• A/B test messaging and outreach strategies to find what works best for your ICP.

Final Thoughts

A great SDR team doesn’t just generate pipeline—it becomes a talent pipeline for your entire company. Invest in hiring, training, and coaching, and you’ll see the ROI not just in revenue but in the future leaders you develop.

A deep dive here:

How to Build Out Your SDR Function with Sam Blond, Partner at Founders Fund and Host of SaaStr CRO Confidential

Dear SaaStr: How Should I Structure the Comp Plan for a VP of Customer Success?

For a VP of Customer Success, variable comp should be tied directly to measurable outcomes that align with your company’s growth goals. At $6M ARR, the key metrics to focus on are Net Revenue Retention (NRR), Gross Retention Rate (GRR) and upsell/expansion revenue.

Having said that, time-to-value in the end may matter most of all, especially if anything less than 95%+ of your customers don’t deploy quickly.  Customers that never deploy … never get value.

Here’s how I’d structure it:

1. Variable Comp Percentage: 30%-40% of Total Comp

– 30%-40% of total comp typically is variable for a VP of CS. For example, if their OTE is $250K, $75K-$100K should be tied to performance metrics. This ensures they’re incentivized to drive results while still having a solid base.

2. Quarterly vs. Monthly Targets

– Quarterly targets are better for a VP of CS. Monthly targets can create unnecessary short-term pressure, especially since CS metrics like retention and upsells take time to materialize. Quarterly gives enough runway to see meaningful results while still keeping accountability tight.

3. Specific Metrics to Measure

Here’s what I’d recommend tying their variable comp to, with specific targets:

a. Net Revenue Retention (NRR)

– Weight: 50%-60% of variable comp.
– NRR measures how much revenue you’re retaining and expanding from your existing customers. For a Series A startup, aim for **110%-120% NRR**. If you’re at 100% NRR now, set a quarterly goal to increase it by 2%-3% per quarter.
– Example: If NRR improves from 105% to 110% in Q2, they earn 100% of this portion of their bonus.

b. Gross Retention Rate (GRR)

– Weight: 20%-30% of variable comp.
– GRR is the foundation—it shows how much revenue you’re retaining before upsells. A strong GRR (80%-90%) ensures you’re not masking churn with upsells. Set a quarterly target to maintain or improve GRR by 1%-2%.
– Example: If GRR improves from 85% to 87% in Q3, they earn 100% of this portion of their bonus.

c. Upsell/Expansion Revenue

– Weight: 20%-30% of variable comp.
– This is about driving additional revenue from your existing customer base. Set a quarterly target for upsell revenue growth, e.g., **$100K in net new expansion ARR per quarter**.
– Example: If they hit $120K in upsells in Q4, they overachieve and earn 120% of this portion of their bonus.

4. Additional Metrics (Optional)

If you want to go deeper, you can add smaller weightings for:
– Time-to-Value (TTV): How quickly customers realize ROI from your product. Shorter TTV = faster expansion opportunities.
– Customer Advocacy:  Number of new case studies, testimonials, or referenceable customers created each quarter.

5. How to Measure

– Use tools like Gainsight, Salesforce, or HubSpot to track NRR, GRR, and upsell revenue. Automate reporting so there’s no ambiguity.
– Segment metrics by customer size (SMB, mid-market, enterprise) to ensure the VP is driving improvements across the board, not just cherry-picking easy wins [1][3][8].

6. Example Quarterly Bonus Plan

Let’s say the VP’s variable comp is $100K annually ($25K per quarter):
– NRR: 60% weight = $15K. Target: Increase NRR from 105% to 110%.
– GRR: 20% weight = $5K. Target: Maintain GRR at 85% or improve to 87%.
– Upsells: 20% weight = $5K. Target: $100K in net new expansion ARR.

If they hit all targets, they earn 100% of their bonus. If they exceed targets (e.g., 115% NRR or $150K in upsells), offer accelerators—e.g., 120% payout for overachievement.

7. Why This Works

This structure aligns their incentives with your company’s growth. If they drive NRR to 120%, that’s an additional $1.2M in ARR at your scale—well worth the bonus payout. Plus, tying comp to measurable outcomes ensures they’re focused on what matters most: retention, expansion, and customer success as a revenue driver, not just a cost center.

Still, having more than one core KPI has some challenges. 

The plan above makes NRR the core lighthouse metric, but still 3 total KPIs.  Almost everyone will focus almost all their energy where it’s easiest to hit their value comp.

Dear SaaStr: What Are Some Red Flags in a Founder?

A few:

1. Doesn’t know the market cold. Always pass. The best founders know the market cold, even in the earliest days.
2. Doesn’t understand or respect the competition. The best always do. Even if they are beating the competition.
3. Can’t recruit a strong management team. This is half the job, ultimately.
4. Too tired. Yes, being a founder is insanely hard. But you have to find a way, and to find the energy, to go long.
5. Lies about anything. If they do, it will just be the beginning.
6. ”Woe is me” attitude. Woe is you, indeed.
7. Always blaming the markets, or claiming it’s all due to a “downturn” or “recession”. Tech and innovation makes its own growth.
8. Running out of money. It’s your job not to.
9. Letting the mediocre stay — and lead. Everyone stops working hard enough when the mediocre are allowed to lead.
10. Not very responsive. The best CEOs always are.

The best once in a while exhibit 1 or 2 of these issues for a little while.  But not for long.

Dear SaaStr: Should I Visit My Customers More?

Yes. Absolutely.

You should visit your customers more. I can’t stress this enough—getting in front of your customers is one of the most effective things you can do to drive growth, retention, and expansion. It’s not just about building relationships, it’s about understanding their needs, getting unfiltered feedback, and showing them you’re invested in their success.

Here’s why it works:

1. You Always Learn More Than You Expect

When I was scaling Adoe Sign / EchoSign, I didn’t visit customers enough early on. My mentor called me out on it, and he was right. Once I started visiting them, I learned things I never would have over email or Zoom. Customers opened up about what they loved, what they hated, and what they needed next. That feedback directly shaped our roadmap and helped us grow faster.

And two big ones — BT and GE — took a risk on us they wouldn’t have over Zoom.

Should You Still Visit Your Prospects In Person? Almost Certainly

2. It Strengthens Relationships

Especially with your top customers, in-person meetings build trust. When you visit, you’re not just another vendor—they see you as a partner. I’ve said this before: I never lost a customer I visited in person. Never. That’s how powerful it is.

I Never Lost a Customer I Actually Visited In Person

3. Roadmap Presentations Are Gold

If you’re unsure how to structure these visits, do a roadmap presentation. Show them what’s coming in the next 12 months and ask for their input. It’s not a sales pitch, but it often leads to upsells and renewals because they see you’re committed to their success. Plus, it gets more stakeholders in the room, which is a win.

Customers Love a Good Product Roadmap Review. Go Do More of Them.

4. It’s a Competitive Advantage:

Your competitors probably aren’t doing this. In today’s remote-first world, most founders and execs avoid travel. But the vendor that shows up in person wins the deal, the upsell, and the long-term loyalty. It’s that simple.

The Customers We Visit Are Worth 40% More Than Those We Don’t

Start with your top 5-10 customers. Visit them at least twice a year.

Bring your head of customer success or product with you—they can answer questions and show your team’s commitment. And if you’re worried about the cost, think of it this way: the ROI on retaining and expanding your biggest accounts far outweighs the price of a plane ticket and a steak dinner.

Here are some guidelines:

• Show up in person to any $50k+ competitive deal.  If the deal is competitive, and you show up, your odds of winning go way, way up.
• Show up in person to any $100k+ deal if you can, even if you think you’ve “won” it or are the clear default choice.  These deals are worth the time and effort to travel, almost always, unless you are very remote.
• Show up in person to every local $50k+ deal.  There is no excuse if you are in the Bay Area, and your prospect is as well, to not go meet in person.
• Show up in person to every Top 100 logo deal. Figure out the Top 100 logos you want to get.  And force the team to go in person.  Even if it’s a $5k deal today, of course, a top logo deal can be six figures over time.
• Show up in person if the competition does, period, if you want to win it.  Thing is, it’s hard to know until it’s too late.
• Customers outside of tech often expect an in-person visit for bigger deals, period.  If you are struggling to close non-tech customers over Zoom, there’s a reason why.  It’s not SOP there.  Go visit.  Go make a customer call in person.

Dear SaaStr: What’s the Best Way to Follow Up With a Prospect That Says “I’ll Get Back to You”

First, be honest.  Those words probably mean either a No or Not Now.

The best way to follow up with a prospect who says they’ll “get back to you” is to take control of the process without being pushy. Here’s how you do it:

1. Set a Clear Next Step Before Ending the Call.  Always Do This. 

Never leave a conversation without locking in a next step. If they say, “I’ll get back to you,” respond with something like, “That sounds great—how about I follow up with you next Tuesday to check in?” This puts a specific timeline in place and keeps the momentum going. If you don’t set a next step, you’re leaving the deal in limbo, and it’s much harder to re-engage later.

2. Follow Up Quickly and Add Value

When you follow up, don’t just say, “Hey, just checking in.” That’s lazy and adds no value. Instead, reference your last conversation and provide something useful—like a case study, a relevant article, or a feature update. For example: “Hi [Name], I wanted to follow up on our conversation last week. I also thought you might find this case study on [similar customer] helpful as you evaluate your options.”

3. Create Urgency Without Being Pushy

If the prospect seems genuinely interested but non-committal, you can create a sense of urgency by tying your follow-up to a specific event or deadline. For example: “I wanted to check in because we’re running a promotion that ends next week, and I think it could be a great fit for your team.” Or, “I’d love to get your feedback before we finalize our Q2 roadmap.”

4. Be Persistent, But Not Annoying. Would You Want to Get That Email?

You can follow up multiple times, but space it out and make each touchpoint meaningful. A good cadence might look like this:

– Day 1: Follow up with a thank-you and a resource.

– Day 3-5: Check in with a specific question or offer.

– Day 7-10: Share another piece of value or insight.

– After that: Space follow-ups 1-2 weeks apart.

If you’re adding value each time, you can follow up more frequently without annoying the prospect.

5. Know When to Move On

If a prospect hasn’t responded after 3–4 follow-ups, it’s probably time to move on. You can always circle back in a few months, but don’t waste too much time chasing someone who isn’t engaging. Focus on prospects who are more likely to convert.

Final Thought

The phrase “I’ll get back to you” is often a polite way of saying, “I’m not ready to commit yet.”

Your job is to stay top of mind, provide value, and make it easy for them to re-engage when they’re ready.

Dear SaaStr: What Can We Do To Make Our Customers Truly Happier?

Keeping your clients happy boils down to one thing: delivering value consistently.  For real.

Let’s break it into actionable steps:

1. Define Success Together

This is skipped or glossed over way, way too often.  From the start, align on what success looks like for your client. What outcomes are they expecting? If you don’t define this early, you’ll constantly be guessing—and that’s a recipe for dissatisfaction. Make sure you’re solving their most pressing pain points, not just offering a generic solution.

2. Onboard Like It’s Your Job (Because It Is)

Few things are more important than upgrading onboarding.  The first 30-90 days are critical. If your onboarding process is sloppy or leaves them confused, you’re setting the relationship up for failure. Assign a dedicated resource to guide them through onboarding, ensure they’re using your product effectively, and address any concerns early.

GuideCX: 5 Ways to Improve Client Onboarding and Implementation Experiences — and Earn Customers for Life

3. Stay Proactive, Not Reactive

Don’t wait for clients to come to you with problems. Check in regularly—quarterly business reviews (QBRs) are great for this. Use these touchpoints to show them the ROI they’re getting, share new features, and discuss how you can help them achieve their goals.

Want Happy Customers? Implement the 5-Visits-Plus-2-Badges Rule. For Your Customer Success Team — And You. (Updated)

4. Invest in Customer Success

A strong customer success team is your secret weapon. They’re not just there to put out fires—they’re there to build relationships, drive adoption, and ensure renewals. If you’re early-stage, even one great CSM can make a huge difference. And if you’re scaling, make sure your CSMs have the resources they need to succeed.

5. Listen to Feedback (Even When It Hurts)

If a customer is complaining, that’s actually a good sign—they care enough to tell you what’s wrong. The real danger is when clients go silent. Actively solicit feedback, whether through surveys, NPS, or direct conversations, and act on it. Show them you’re listening and making changes based on their input.

Customer Success Has Gone from The Customer’s Ally To Its Nemesis

6.  Deliver on Your Promises

Nothing kills trust faster than overpromising and underdelivering. Be realistic about what your product can do, and if you make a commitment, follow through. If something goes wrong, own it, fix it, and communicate transparently.

7. Focus on Outcomes, Not Just Features

Clients don’t care about your product’s bells and whistles—they care about how it helps them achieve their goals. Always tie your conversations back to the outcomes they’re looking for. If you’re not sure what those outcomes are, go back to step one.

8. Upsell the Right Way. No Renewal Ripoffs.

Upselling isn’t about squeezing more money out of your clients—it’s about helping them get even more value. If you’ve built trust and delivered results, they’ll be open to expanding their relationship with you. But if you push too hard, too soon, you’ll damage the relationship.

9. Make It Easy to Leave (Yes, Really)

If a client wants to leave, don’t make it a nightmare. Help them transition smoothly, and they might actually come back—or at least recommend you to others. Making it easy to leave shows confidence in your product and respect for your clients.

You’ll Lose Customers. It Hurts. But Don’t Let Them Become Angry Ex-Customers.

10. Celebrate Their Wins

When your clients achieve something big—whether it’s hitting a revenue milestone, launching a new product, or anything else—celebrate with them. It shows you’re invested in their success, not just your own.  Even show up in person if you can.

Final Thought

Happy clients don’t just stick around—they become your biggest advocates. They’ll refer new business, give you glowing testimonials, and help you grow faster than any marketing campaign ever could. Focus on delivering value, building trust, and being a true partner, and the rest will follow.

And … what not to do here:

Dear SaaStr: Do I Have to Provide a Promotion Path from SDR to AE?

Probably.

In the end, about 70% of SDRs move into account executive roles.  Usually, within a year.

It’s very common for SDRs to move into sales roles, particularly Account Executive (AE) positions. In fact, this is often the natural career progression for many SDRs.  It’s why they take these often entry-level roles.

And once you start to scale, you’ll make this work.

1. BDRs Are a Training Ground for AEs

The BDR role is designed to teach foundational sales skills—prospecting, cold outreach, qualification, and pipeline generation. These are critical building blocks for becoming an AE. At companies like Brex, for example, the top-performing AEs were often former BDRs who had mastered these skills before moving into closing roles.

How to Build Out Your SDR Function with Sam Blond, Partner at Founders Fund and Host of SaaStr CRO Confidential

2. BDRs Already Understand Your Sales Process

BDRs already know your ICP (Ideal Customer Profile), your messaging, and your sales process. They’ve been working closely with AEs, so they’re familiar with how deals are managed and closed. This makes them easier to ramp up as AEs compared to hiring externally.

3. It’s a Huge Motivator

Offering a clear path from BDR to AE is one of the best ways to retain top talent. The best BDRs often want to be promoted quickly—sometimes within 6-12 months. If they don’t see a path forward, they’ll start looking for AE roles elsewhere. Creating this progression keeps them engaged and motivated.

4. Internal Promotions Build a Stronger Culture

Promoting from within shows the team that hard work is rewarded. It also creates a culture of mentorship, where AEs are more likely to invest in helping BDRs succeed because they know those BDRs could be their future peers.

Companies that clearly communicate career paths—whether to AE, customer success, marketing, or operations—tend to retain BDRs longer. For example, some companies use a “buddy system” where BDRs shadow AEs to prepare for the transition to closing roles

That said, not every BDR will want to—or should—become an AE.

Some might prefer to stay in a senior BDR role, move into customer success, or even explore marketing or operations. It’s important to have conversations with your BDRs about their career goals and provide multiple paths for growth.

And if your best SDRs want to stay SDRs, carve out a lucrative path for them to stay Senior SDRs.  They’ll often deliver 3x-10x what new SDRs will.  So pay up 😉 

Dear SaaStr: How Common Is It For a Seed Investor To Have The Right to Block a Sale?

It’s not super common to have an explicit “veto”, but it’s not unheard of either.  Usually it’s phrased as a consent by the investors rather than a veto.  And usually you are going to need most investors’ votes to sell even if you don’t need their consent.  That’s important.

It’s very, very hard to sell your start-up unless 80%+ of the investors agree.  No matter what the docs say.

Here’s the deal:

• In a $3M seed round, most VCs won’t explicitly ask for the ability to block a future sale unless they’re taking a significant ownership stake—say, 15% or more—and even then, it’s not standard.
• However, protective provisions are often baked into the term sheet, and these can give investors veto rights over major decisions, including a sale of the company.
• And various state and other laws give shareholders protections.
• And finally, acquirers are going to require at least a majority of all investors agree to any sale.  Often 80%-90% really.

What to Watch For:

1. Standard VC Protective Provision

These are clauses that require investor approval for certain actions, like selling the company, raising more funding, or issuing new shares. In a seed round, it’s typical for investors to have some protective provisions, but they shouldn’t be overly restrictive. Still, these rights are highly standard and often include a class vote on any sale.

2. Board Control

If the VC is asking for a board seat and you only have a small board (e.g., 3 people), they could potentially block a sale if they control one-third or more of the votes. This is why it’s critical to maintain founder-friendly board dynamics at the seed stage. A 3-person board with 2 founders and 1 investor is fine, but if you add another investor later, the balance changes here.

3. Reasonable vs. Overreaching

Most seed VCs are founder-friendly and won’t push for excessive control. They’re betting on you to build the company, not trying to micromanage. But if you see terms like a **right of first refusal (ROFR)** on a sale or an explicit veto right, you need to push back. These terms can make it harder to sell the company later or negotiate with other buyers.

What’s Fair? Majority Approval

If you have multiple investors, it’s common for a sale to require approval from a majority of preferred shareholders. This is fair and ensures alignment among your investors, but it shouldn’t give a single VC the power to block a sale unilaterally.

Having said that, it’s more common that not for each Series (Seed, A, B, C, etc) to have it’s own protective provisions.  Which will include a vote on a sale.

How to Handle It:

• Raise less. The less you raise, the less control you give up.
• Have a Balanced Board.  Roughly equal to your cap table.  Most won’t push back if you do.
• Make one ask in a term sheet.  Push back on one control provision.  If it’s just one ask, you’ll often get it.
• Only major shareholders need board seats & specific rights.  Anyone buying 10% or more has the right to ask.  Anyone buying 2% or less is just a passenger.
• Don’t cross the line.  Remember folks are giving you millions of dollars.  The commitment back is going for it.

In short, a VC shouldn’t have the ability to block a sale — unless they’re a major stakeholder, and even then, it’s something you should negotiate carefully.

Remember: if you don’t raise too much, most VCs are fine with any sale where they make money.  And no one will be happy if they don’t.

And once you raise a ton, the stakes go up.  As they should.

It’s pretty simple in most cases.

A related post here:

Can You Sell Your Startup Below the Last Round Price? Probably. It’s More Common Today.